Abstract:
Valuations are an integral part of any discussion concerning a new technology venture. A valuation is a process by which the value of a company or piece of intellectual property is determined. New technology progresses through various levels of maturity depending on several factors. Nanotechnology presents some unique issues for valuation models because many nanotechnology companies are properly characterized as early stage, pre-revenue companies. A hybrid model of maturity, therefore, most accurately values many nanotechnology companies. In this article, Kevin G. Coleman explains one such hybrid model developed to provide more accurate nanotechnology company valuations. The model emphasizes thorough consideration of both quantitative and qualitative factors affecting value and includes a vast number of inputs and leverages numerous benchmarks. It then uses these inputs to make impact assessments in the following areas: business, government, society and education. Each one of these impact areas is further broken down to develop an impact score on several discrete benchmarks within each impact area. In this way, the model may be used to calculate current asset value, market value and recommended value for the nanotechnology company. After the dot-com era, valuation models have shifted focus from intangible assets to more specific benchmarks to assist in accurate valuation; however, no one method of valuation will fit perfectly to all of the different situations surrounding companies involved with a new technology such as nanotechnology.